RFAs: Economics of Climate Change and Cost of Inaction

Projects are designed to build a more robust understanding of the costs of climate inaction, including the distribution of those costs, the impacts of climate change itself, foregone co‑benefits such as improvements in health and biodiversity, and the increased need for adaptation measures. By doing so, these efforts aim to stimulate higher levels of ambition in climate policymaking and investment.

The programme encourages greater consistency and collaboration across socio‑economic and physical science disciplines, fostering enhanced inter‑ and transdisciplinary approaches. Such cooperation is intended to produce improved, more realistic and context‑specific assessments of the socio‑economic impacts of climate change, tailored to regional conditions. These strengthened assessments are expected to equip public and private decision‑makers with better tools and insights to inform strategic choices about climate action, security and resilience.

All projects funded under this topic are strongly encouraged to collaborate with each other and to undertake clustering activities with relevant efforts both within and outside Horizon Europe. This integrative approach aligns with the broader goals of advancing science for a fair transition to a climate‑neutral and resilient society, as set out in the Horizon Europe strategic plan for 2026–2027, which allocates a total funding envelope of 16 000 000 for Research and Innovation Actions under this topic, with a maximum of 4000000 euro available per project.

Advancing knowledge of how climate change impacts interact with economic performance — both globally and within the EU — is another key objective. Greater clarity is sought on how climate change and climate policies affect European competitiveness, economic security and strategic autonomy, with careful evaluation of the opportunities, risks, benefits and costs involved for the EU economy and its citizens.

A further outcome is to ensure that the best available evidence and policy recommendations are made available in a timely manner and effectively transferred into major international and regional climate frameworks, assessments and policy instruments. Outputs from funded projects are expected to support processes such as the Paris Agreement, European Climate Risk Assessments, the European Climate Adaptation Plan, the Preparedness Union Strategy, the Clean Industrial Deal, and global scientific assessments such as those produced by the IPCC and IPBES.

The scope of this research reflects the urgency highlighted by the IPCC to better understand the benefits and opportunities associated with deep, rapid and sustained mitigation and accelerated adaptation action to inform strategic decisions. Comprehensive assessments of the socio‑economic impacts of climate change are essential, yet current approaches face substantial challenges, including wide uncertainty in damage estimates, fragmented methodologies, and overreliance on historical data that may no longer reflect unprecedented changes in the climate system.

To address these challenges, projects funded under this topic require interdisciplinary collaboration among physical scientists, economists and social sciences and humanities disciplines. They should include co‑design processes with stakeholders such as government representatives, public administrations and private sector actors to ensure that results are relevant and readily taken up by end users.

Applicants must choose to address one of two priority areas. Projects under Area A: Global are global in scale but must also provide regionally resolved insights that enable comparison across world regions, especially between developing and developed contexts, and are expected to foster international cooperation with low and middle‑income countries. Area B: The EU projects focus specifically on the EU, with particular attention to implications for industrial performance, security of supply and strategic autonomy.

The initiative contributes directly to key strategic priorities including the green transition, digital transition, and building a more resilient, competitive, inclusive and democratic Europe. Research under this destination aims to support climate action, close major knowledge gaps, strengthen the European Research Area on climate change, and explore synergies between climate strategies and other policy objectives such as biodiversity, disaster preparedness, digitalisation, circular economy, prosperity and the Sustainable Development Goals.

For more information, visit European Commission.